Inside Gsa’s Mass Lease Terminations

The Department of Government Efficiency’s elimination of nearly 750 federal land leases is sowing confusion throughout the federal government, potentially shuttering IRS help centers weeks before tax returns are due and leaving prosecutors who handle drug cases near the border without office space.

The cancellations could rattle the real estate markets in places with large federal government presence, such as Washington, D.C., the tri-state area and even Kansas City, Missouri. They have already hit 30 Social Security buildings across the country, according to DOGE.gov, as well as the National Centers for Environmental Prediction in Maryland, which gathers data for the National Weather Service, the Verge reported.

The Public Buildings Service at the General Services Administration, which manages the federal government’s buildings, was instructed to terminate leases that allow for an early exit with little regard for the size of the workforce occupying the space or its square footage, according to a GSA official granted anonymity to speak freely.

The cancellation of millions of square feet of government office spaces are part of DOGE’s strategy of rapid deployment of significant cost-cutting measures that will have dramatic effect on the federal workforce — and will be difficult to undo later. DOGE says the lease cancellations have already saved $660 million but that figure is likely an overestimate because it includes lease months that have already been paid, among other factors.

To implement this, officials compiled a list of all federal leases with termination rights and ran each agency’s list by the respective political appointees. There are approximately 3,000 federal leases that are currently in their “soft term” phase—meaning they can be terminated without a penalty or buyout. That is nearly half of GSA’s portfolio of more than 7,000 leases.

Over the past week, hundreds of Docusign packages with formal termination notices have been sent out, often arriving without warning to property owners, who are accustomed to working with local GSA contacts on lease amendments.

“Most lease amendments of this sort are done locally, with known contacts so confusion is rampant,” the GSA official said.

The rush to cancel contracts has already led to errors. Some leases flagged for elimination do not actually contain termination rights, forcing GSA to rescind notices after landlords pushed back. In other cases, property owners have been blindsided by unexpected termination notices coming from unfamiliar GSA contacts, sparking a flurry of frantic emails demanding explanations.

“We were completely shocked by this notice, especially considering that the IRS is actively occupying the entire space,” Zaya Younan, the owner of a Phoenix office building that received a termination notice, wrote to GSA’s leasing office in an email reviewed by POLITICO. “This location serves as the IRS’s main hub in Phoenix, and the office remains fully utilized with workers reporting to work daily.”

Younan concluded that the termination notice must be a mistake, asking GSA to confirm whether termination was indeed intentional. The property is in fact one of more than 110 IRS offices with taxpayer assistance centers that the Trump administration will shutter.

Elsewhere, GSA terminated the U.S. Attorney’s Office lease in Corpus Christi, Texas, leaving federal prosecutors who handle drug and immigration cases scrambling to find new work space. It’s also terminating leases for some offices of the U.S. Army Corps of Engineers, which maintains waterways and provides engineering support for the military.

This aggressive lease-cutting strategy coincides with the administration’s push to downsize the federal workforce and to enforce a strict return-to-office mandate. That means thousands of federal workers who still have their jobs will be forced into cramped, makeshift workspaces or left without office space at all.

While mistakenly fired employees can be hired back in a relatively short period of time, undoing lease terminations may prove more difficult to undo.

Once a lease termination notice is executed, undoing it is at the sole discretion of the property owner, the GSA official said. Obtaining a new lease, renovating the space for government use and moving people back is usually a two-year process, assuming GSA still has the contracting staff to handle it.